The Investment Company Institute's latest "Money Market Fund Assets" report shows MMF assets declining again following the June 15 quarterly tax payment date and Juneteenth long holiday weekend, after hitting records for 7 straight weeks (and 13 weeks out of the past 15). Assets have risen by $613 billion, or 12.7%, over the past 17 weeks, breaking the $5.4 billion barrier three weeks ago. ICI shows assets up by $699 billion, or 14.8%, year-to-date in 2023, with Institutional MMFs up $383 billion, or 12.5% and Retail MMFs up $316 billion, or 18.9%. Over the past 52 weeks, money fund assets have risen $891 billion, or 19.6%, with Retail MMFs rising by $549 billion (38.0%) and Inst MMFs rising by $342 billion (11.0%). (Note: Thanks to those who attended our Money Fund Symposium this week in Atlanta! Conference materials are available in our "Money Fund Symposium 2023 Download Center," and recordings will be posted in coming days.)
Their weekly release says, "Total money market fund assets decreased by $18.23 billion to $5.43 trillion for the week ended Wednesday, June 21, the Investment Company Institute reported.... Among taxable money market funds, government funds decreased by $22.35 billion and prime funds increased by $4.55 billion. Tax-exempt money market funds decreased by $431 million." ICI's stats show Institutional MMFs dropping $24.9 billion but Retail MMFs rising $6.7 billion in the latest week. Total Government MMF assets, including Treasury funds, were $4.498 trillion (82.8% of all money funds), while Total Prime MMFs were $823.0 billion (15.1%). Tax Exempt MMFs totaled $113.0 billion (2.1%).
ICI explains, "Assets of retail money market funds increased by $6.66 billion to $1.99 trillion. Among retail funds, government money market fund assets increased by $2.82 billion to $1.34 trillion, prime money market fund assets increased by $4.19 billion to $554.51 billion, and tax-exempt fund assets decreased by $346 million to $102.41 billion." Retail assets account for over a third of total assets, or 36.7%, and Government Retail assets make up 67.1% of all Retail MMFs.
They add, "Assets of institutional money market funds decreased by $24.89 billion to $3.44 trillion. Among institutional funds, government money market fund assets decreased by $25.16 billion to $3.16 trillion, prime money market fund assets increased by $359 million to $268.47 billion, and tax-exempt fund assets decreased by $84 million to $10.58 billion." Institutional assets accounted for 63.3% of all MMF assets, with Government Institutional assets making up 91.9% of all Institutional MMF totals. (According to Crane Data's separate Money Fund Intelligence Daily series, money fund assets have risen by $10.2 billion in June through 6/21 to $5.836 trillion. Note that ICI's asset totals don't include a number of funds tracked by the SEC and Crane Data, so they're over $400 billion lower than Crane's asset series.)
In other news, we wrote yesterday and earlier this week about the Association for Financial Professionals' "2023 AFP Liquidity Survey. (See AFP's press release; our June 20 News, "AFP 2023 Liquidity Survey: Deposits Plunge from 55 to 47%, MMFs Jump;" and our June 14 Link of the Day, "AFP Releases 2023 Liquidity Survey.") Today, we quote from the section on ESG.
AFP's survey says, "Thirteen percent of respondents report that their organizations are considering ESG parameters for operating cash -- a significant decrease from the 25 percent reported last year, and the 17 percent in 2021, but up slightly from the 14 percent in 2019. This result also contrasts with the investment policy changes noted in earlier (see page 18); putting ESG parameters in place for an organization's overall investment portfolio as well as for money market funds are the two parameters most-often considered when making investment policy changes."
It explains, "Nearly three-fourths of respondents indicate their organizations are not considering ESG parameters for their operating cash holdings (again, in contrast to anticipated Investment policy changes noted earlier for money funds), while 12 percent are unsure if their organizations do so. Both net borrowers and non-investment grade organizations are less likely to consider ESG criteria than are other organizations."
AFP writes, "Of those companies considering ESG parameters, only 5 percent do not have any of their operating cash in ESG investments, while 41 percent have less than 5 percent and 32 percent have between 5 and 10 percent of operating cash in their short-term investments. This is a significant difference from the survey results last year: 48 percent of organizations did not have any of their operating cash in ESG Investments. The percentage of organizations that have over 10 percent of their operating cash in ESG investments increased from 6 percent in 2022 to 22 percent this year."
On "ESG Investments," they tell us, "Of those organizations investing in ESG investments, ESG money funds (including D&I Categorized funds) are most popular, with 57 percent of organizations choosing to invest in them. In this year’s survey, AFP expanded the minority-owned answer choices to allow for a more nuanced reporting of ESG investment options. This year, women-owned (WBE or WOSB) broker providers are the second-most cited choice for investors, selected by 35 percent of organizations. Separately managed accounts and minority-owned (MBE) broker providers each attracted 26 percent of organizations. Some respondents mention the use of Qualified Opportunity Funds, designed to invest in real estate opportunity zones, as ESG investment options which help with development of economically distressed areas while providing investors with certain tax benefits."
